The cryptocurrency market is experiencing a new wave of skepticism, even in light of Bitcoin’s price recovery. According to analysts at CryptoQuant, the current behavior of investors indicates caution and a lack of faith in the sustainability of the new upward trend.
This is reported by Business • Media
Negative Sentiment and Short Positions on Binance
One of the key indicators of market expectations is the funding rate. On the Binance exchange, which holds a leading position in the derivatives market, this metric has remained negative for six out of the last seven days. The current rate stands at approximately -0.004%, indicating a dominance of short positions among traders. This situation has arisen following the market drop on the night of October 11, when most participants began opting for short-selling strategies and anticipating further declines.
Historical Parallels and Potential for a Short Squeeze
Analysts emphasize that a similar market structure was observed in September 2024 and April 2025, when Bitcoin showed recovery after significant downturns. The situation is now repeating itself: a period of skepticism could set the stage for a sharp rise if the price moves upward due to the liquidation of a large number of shorts. Such a scenario could lead to a so-called short squeeze and push Bitcoin’s value toward key liquidity zones at $113,000–$126,000.
“However, paradoxically, the longer this skepticism lasts, the stronger the potential for an explosive upward move. If the current bullish trend continues to develop, the increasing number of short positions could become powerful fuel for the next growth phase,” experts stated.
Earlier, CryptoQuant reported that open interest in Bitcoin had decreased by $12 billion over the week, which also serves as an indicator of changing market sentiment and growing caution among investors.